In a landmark move, South Korea’s National Tax Service (NTS) has announced that it will extend its digital-asset tax enforcement beyond exchanges and into private residences.
The agency confirmed that it now has the authority to seize hardware wallets, hard drives, and other storage devices if investigators suspect individuals are hiding undeclared cryptocurrency holdings offline.
From Blockchain Tracking to Home Inspections
Tax authorities in South Korea already employ advanced blockchain-tracing tools to monitor crypto transactions and compare them with reported income. When digital trails vanish into private or “cold” wallets, investigators will now “follow the evidence into the physical world,” according to an NTS official quoted by Hankook Ilbo.
“We’re no longer stopping at the exchange level,” the official said. “If signs point to offline concealment, we will visit the address.”
The move marks a dramatic escalation in South Korea’s already stringent crypto compliance regime, underscoring the government’s intent to close tax loopholes in one of the world’s most active digital-asset markets.
Rising Adoption, Rising Tax Evasion
The country’s crypto market has grown exponentially since 2020, with over 11 million active investors today, up from just over one million five years ago. However, the boom has also given rise to sophisticated tax evasion methods, particularly through cold storage devices that keep funds disconnected from exchanges.
Since 2021, the NTS has recovered more than $108 million in undeclared digital assets from 14,000 taxpayers, often through asset seizures and forced liquidation. Meanwhile, the Financial Intelligence Unit (FIU) has logged nearly 37,000 suspicious transaction reports from crypto platforms in 2025, already surpassing the combined totals of the previous two years.
Officials say the intensified crackdown reflects both the sector’s explosive growth and the mounting risks of crypto misuse. As South Korea strengthens oversight, the country is rapidly becoming a test case for global crypto tax enforcement, blending blockchain analytics with old-fashioned, door-to-door investigation.
